Harper government's voluntary CPP plan found little support

Internal Finance Canada document asked Canadians whether they support a voluntary CPP. The answer? No

Then finance minister Joe Oliver unexpectedly proposed to the House of Commons last May that Canadians be allowed to make voluntary contributions to the Canada Pension Plan. The proposal, an abrupt reversal of Conservative policy, was rejected by Canadians in a Finance Department online consultation. (Adrian Wyld/Canadian Press)

Dean BeebySenior reporter, Parliamentary Bureau

Dean Beeby is a CBC journalist, author and specialist in freedom-of-information laws. Follow him on Twitter: @DeanBeeby

The Conservatives had firmly rejected a voluntary CPP scheme as far back as 2010. But faced with an October federal election, and with two opposition parties promising CPP benefit increases, the about-face added a pension plank to the Tory platform.

Only 47 stakeholders and individuals sent in responses to the online consultation, with 26 against any voluntary CPP scheme, 17 in favour and four offering no opinion, says a heavily censored Oct. 6 briefing note.

Among the 25 submissions from stakeholders, none of whom are identified, there was overwhelming opposition to Oliver's idea. Seventeen were opposed, six were in favour and two did not say.

Create confusion?

"Many of the submissions received raised concerns related to whether another voluntary option is needed and whether such an option could be costly to administer," says the note, obtained by CBC News under the Access to Information Act.

"Many of those who were against it recommended a mandatory expansion and/or enhanced financial literacy and promotion of existing measures instead.… The general view was that another voluntary savings measure is not needed and could create confusion."

The 22 individuals who answered the consultation were slightly in favour, with 11 supporting Oliver's proposal, nine opposed and two offering no opinion. "The majority of the individuals against a voluntary supplement were in favour of mandatory expansion," says the note, prepared for deputy minister Paul Rochon.

Seeking consensus

The Trudeau government has promised to work with the provinces to beef up the Canada Pension Plan, but a key finance ministers meeting in December failed to reach consensus, ending only with a promise of more study. Ottawa needs the agreement of seven provinces, including Quebec, representing two-thirds of the country's population, to enact reforms to CPP.

The Conservative government and the Canadian Federation of Independent Business, among others, railed against proposals for mandatory increases to CPP, calling them a tax on jobs and citing claims by Finance Canada of up to 70,000 jobs killed under various schemes.

'The voluntary thing from Oliver was never going to work.'— Pension expert and author Keith Ambachtsheer

But proponents question the job-loss math, saying that the economy can absorb gradual, phased premium hikes as it did between 1997 and 2003, when a round of significant CPP premium hikes coincided with a drop in the jobless rate.

The Canada Pension Plan, created in 1965, was intended to supplement workers' company pensions and private savings. It currently pays out a maximum of $13,110 annually, based on the number years of mandatory contributions, split equally between workers and employers.

But in the last two decades, many firms have reduced or abolished their own plans, raising questions about whether Canada's middle class can retire as securely as a previous generation.

Pension expert Keith Ambachtsheer called Oliver's announcement last year a lot of "smoke."

"The voluntary thing from Oliver was never going to work," Ambachtsheer, an author and pension consultant, said from Toronto. "Of course there wasn't going to be any take-up."

Ontario plan called 'ground zero'

"Canada already has lots of voluntary options. Why do we need another? To materially increase workplace pension coverage, it has to be mandatory."

Ambachtsheer says he was not one of the 47 respondents to the online consultation.

After failing to persuade the Harper government to improve the CPP, Ontario Premier Kathleen Wynne announced a provincial plan to be in place by Jan. 1, 2017, called the Ontario Retirement Pension Plan.

Still a work in progress, the Ontario plan would require mandatory employer-employee contributions unless a company already provides a comparable retirement benefit to its workers.

Ambachtsheer calls the ORPP "ground zero" for discussion about secure retirements for Canadian workers, because "we are years away from possibly reaching some national consensus as to how to increase workplace coverage on a national basis."

He said there should be more private-sector pension plan options for Ontario companies, to provide more competition to the ORPP.

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